The percentage of “new” severe delinquent residential mortgages reported for September 2015—that is, the number of severely delinquent loans that were current six months ago—was the lowest of any September since 2009, according to Black Knight Financial Services.
The share of new severely delinquent borrowers in September was reported at 0.66 percent, a number that has been steadily declining since hitting its September peak of 2.81 percent six years ago, according to Black Knight. The data shows a seasonal effect to new severe delinquencies; the rate has peaked in every September or October for the last six years.
The number of new severe delinquencies has dropped from an average of three in every 100, its peak reached back in 2009, down to seven for every 1,000 in September of 2015. According to Black Knight, there is a definite seasonal effect to new severe delinquencies; the rate has peaked in every September or October for the last six years.
Mortgages that originated during the bubble years of 2005 to 2008 accounted for the highest percentage of new serious delinquencies; they make up 45 percent of new serious delinquent mortgages even though they account for only 17 percent of total loans in the mortgage universe.
Meanwhile, mortgages that originated during the post-crisis years (2009 to 2015) make up 68 percent of all mortgages but account for just 34 percent of new severe delinquencies, Black Knight reported.
The new severe delinquency rate on mortgages with a second lien was more than twice those without a second lien in September (1.04 percent compared to 0.48 percent), which has been the case for about the last two years, according to Black Knight. During this period, mortgages with a second lien have seen “increased seasonality in new severely delinquent loan rates.”